WASHINGTON — Trump faces midterm pressure as inflation and borrowing costs hit Americans’ wallets five weeks before the Nov. 3 elections.
Pay for rank-and-file workers has trailed inflation in each of the past five months. Consumer prices have risen more than 5 percent since Trump took office in January 2025.
The national average price for regular gasoline stands at $4.48 a gallon, up $1.34 from a year earlier, according to AAA. Filling a 15-gallon tank now costs roughly $20 more than last September.
Mortgage rates have returned above 7 percent. Rates on credit cards, auto loans and other consumer debt remain elevated.
The University of Michigan’s consumer sentiment index fell to 48.1 in September, one of the lowest readings on record and down 15 percent from January.
Paychecks Lag Recent Price Gains
The Conference Board’s confidence index stood at 89.4 in August, well below the 126 average recorded from 2017 to 2019.
These figures form the backdrop for the midterms, with Trump’s economic record effectively on the ballot. Sentiment has deteriorated among Republican voters as well.
Since early 2021, hourly earnings for production and nonsupervisory workers have climbed 29 percent, slightly ahead of the 27 percent rise in consumer prices over the same period. That cumulative edge has eroded recently.
Real average hourly earnings for these workers declined or stalled in several of the latest monthly reports from the Bureau of Labor Statistics as energy and other costs accelerated.
The Atlanta Fed’s GDPNow model estimates third-quarter growth at a 5 percent annualized rate. Unemployment holds at 4.1 percent.
Borrowing Costs Climb Higher
Consumer spending and retail sales have remained firm. Yet the gap between those indicators and household experience is wide.
A hotter economy has strengthened the argument for the Federal Reserve to maintain higher rates, contributing to the rise in long-term borrowing costs that households face.
Gallup reported that 27 percent of U.S. workers now worry technology could make their jobs obsolete, a record high.
White House spokesman Kush Desai said the underlying data show resilience. “The hard data of actual consumer spending and retail sales have been robust throughout President Trump’s term so far,” Desai said.
“American consumers are proving their resilience with their dollars every day thanks to the Trump administration’s tax cuts, private-sector job creation, and investment boom.”
The administration points to tax policy, job creation and capital investment as drivers of the expansion.
Critics and some Republican strategists note that voters register the cumulative price increases and higher monthly payments more directly than aggregate GDP figures.
Gas prices reflect the impact of the conflict involving Iran, which disrupted energy markets earlier in the year. Diesel prices have also climbed sharply.
Shelter costs and interest rates continue to limit housing affordability. Credit-card balances carry higher financing charges than in the years before 2022.
Consumer surveys show consistent mention of high prices as a drag on personal finances. In the University of Michigan survey, concerns about inflation and fuel costs rose in September. Expectations for business conditions weakened.
Midterm Stakes Center on Affordability
The political calendar leaves little time for conditions to shift. Early voting begins soon in several states. Historical patterns show midterms often function as a referendum on the sitting president’s handling of the economy.
Weak sentiment readings, even alongside low unemployment and solid growth, have previously correlated with losses for the president’s party.
Trump’s first term before the pandemic featured some of the strongest consumer sentiment readings in decades.
The current readings sit near the opposite end of the historical range. The administration argues that spending data, not survey responses, better capture economic reality.
Households continue to spend, yet surveys indicate many feel their paychecks buy less.
The combination of recent real-wage softness, elevated energy prices, and higher borrowing costs defines the closing weeks of the campaign. Growth has materialized. The corresponding lift in household confidence has not.
